San Diego foreclosures remain at 4-year low

The number of San Diego County foreclosures in March stayed at its lowest point in more than four years, essentially mirroring the downward trend seen statewide, based on Tuesday's DataQuick foreclosure report. An improving picture in the distressed market could be attributed to some pick-up in the national economy and increasing number of homeowners who short-sell their homes instead of letting them fall into foreclosure.

A little more than 500 homes fell into foreclosure last month, the lowest it's been since November 2007, when the county recorded 478. The March total is 21 percent lower than the previous month's and more than half of what it was a year ago.

Statewide, foreclosures in the first quarter of 2012 fell to their lowest level since the third quarter of 2007, when 24,209 trustee deeds were filed. They peaked at 79,511 in 2008's third quarter.

Local and statewide numbers for default notices, the official start of the formal foreclosure process, were mixed in March, DataQuick numbers show.

San Diego County recorded 1,500, 17.4 percent bump from February but an 18.3 percent drop from a year ago.

The number of defaults throughout California during the first quarter dropped to its lowest point in nearly five years. More than 56,000 default notices were recorded, down 8.5 percent from the previous quarter and down 17.6 percent from the first quarter a year ago.

The previous low for a quarter was second quarter of 2007, when 53,943 default notices were filed.

Not all defaults lead to completed foreclosures. DataQuick research shows that although 1.5 million of the state's nearly 9 million homes was at some point in the foreclosure process since 2007, 9.6 percent have been foreclosed upon.

Last year, many real estate experts predicted a dramatic wave of foreclosures to reach California that never arrived.

But is there still a chance of that happening in 2012?

"The 'shadow supply' has yet to result in a second huge wave of foreclosures," said DataQuick president John Walsh in this week's foreclosure report. "The 'reset problem' hasn’t really materialized, largely because interest rates are resetting down, not up. And, remarkably, whole batches of presumed ‘toxic’ mortgages continue to perform. There’s no doubt that housing, especially negative equity, is one of the biggest drags on a struggling economy, but it’s not necessarily playing out the way some pundits thought."